What rights does Engineering For Kids grant to the franchisee under the Franchise Agreement?
Engineering_For_Kids Franchise · 2025 FDDAnswer from 2025 FDD Document
tely $250.
ITEM 12 TERRITORY
Grant of Rights and Definition of Territory
Under the Franchise Agreement, we will grant you the right and license to operate your Franchised Business within a Territory. The Territories will vary in size and dimension based on local factors, but a "standard" Territory will generally be determined as a geographic area containing approximately 100 schools with grades including some or all of kindergarten through eighth grade.
You will offer and provide Programs at the Authorized Locations the Programs and sell the Authorized Products, and such other and services and products that we may approve from time to time, to customers of the Franchised Business attending Programs at the Authorized Locations (regardless of where those customers live). You may also offer and provide Special Event Services Programs at the homes (or other facilities) of customers who attend Programs at your Authorized Locations, or who are referred to you by customers who attend Programs at your Authorized Locations. As described in Item 1, Special Event Services are those Programs and
Authorized Products that we approve for sale and use at children's parties, holiday and other celebratory events conducted outside of the Authorized Locations.
You may not, unless you have our prior written approval, engage in any other type of sale, including, selling or distributing products or services at wholesale or to third parties for resale, or using alternate channels of distribution, such as the Internet, catalog sales, or telemarketing.
Territory Rules.
You will conduct Programs, advertise and market the services of the Franchised Business, and directly solicit participants, inside (but only inside) your Territory (subject to our right to approve all advertising and marketing materials). "Direct solicitation" includes solicitation in person, by telephone, by mail, by e-mail or other electronic means, advertising, marketing, and by distribution of brochures, business cards or other materials.
You may not directly solicit participants located, and/or conduct Programs, in the territory of another Engineering For Kids Business (an "Assigned Area"). You may accept participants from an Assigned Area into Programs that you operate inside your Territory if you did not directly solicit those participants. If you receive an inquiry to conduct a Program at a location in an Assigned Area, you must refer that Program to the Engineering For Kids Business operating in that Assigned Area.
You may directly solicit participants from, and conduct Programs in, areas located outside the Territory if those participants and/or Programs are not located in an Assigned Area (an "Open Area") and the following conditions are met. You may only solicit participants from, and conduct Programs in, Open Areas located within 25 miles of your Territory. If you are conducting a Program in an Open Area (an "Outside Program") and that area later becomes an Assigned Area, then you must immediately give control of the Outside Program to the Engineering For Kids Business franchisee for that Assigned Area. Once an Open Area becomes an Assigned Area, you may no longer directly solicit participants from, or conduct any Programs in, the Assigned Area.
If any of your advertising within the Territory is in media that will or may reach a significant number of persons outside of the Territory, you must notify us in advance and obtain our consent. We may periodically establish rules and policies regarding this advertising. Additionally, we may periodically establish rules, guidelines and policies regarding you and other franchisee participation in other promotional activities and events (including without limitation, camp fairs and school fairs) that will or are reasonably expected to serve or draw potential customers and/or Third-Party Sites located in geographic areas serviced by more than one Engineering For Kids Business, and for use in connection with the Virtual Programs.
Other Engineering For Kids Businesses will operate under franchise agreements with restrictions similar to those above (the "Territory Rules"), which means that in some instances other Engineering For Kids Businesses may perform services in your Territory or sponsor advertising which reaches persons in your Territory. Although we do not intend to knowingly permit violations of the Territory Rules, we are not required to take action against franchisees for violations of the Territory Rules.
Territorial Rights and Rights We Reserve
You will not receive an "exclusive" Territory. You may face competition from outlets that we own or from other channels of distribution or competitive brands that we control.
We do, however, provide you with the territorial rights and protections within your Territory described in this paragraph.
Source: Item 12 — TERRITORY (FDD pages 36–41)
What This Means (2025 FDD)
According to Engineering For Kids's 2025 Franchise Disclosure Document, franchisees are granted the right and license to operate their franchised business within a defined territory. A standard territory typically encompasses a geographic area containing approximately 100 schools with grades ranging from kindergarten through eighth grade. Franchisees are authorized to offer and provide programs and sell approved products to customers attending programs at authorized locations, regardless of where those customers reside. They can also offer Special Event Services programs at customers' homes or other facilities if those customers attend programs at the franchisee's authorized locations or are referred by existing customers.
However, Engineering For Kids franchisees do not receive an exclusive territory and may face competition from outlets owned by the company, other distribution channels, or competitive brands controlled by Engineering For Kids. Despite the non-exclusive nature, Engineering For Kids provides certain territorial protections. Specifically, during the term of the Franchise Agreement, Engineering For Kids will not operate or franchise another party to operate an Engineering For Kids business physically located within the franchisee's assigned territory, nor will they grant a franchise for the same territory to another party.
The Franchise Agreement specifies that Engineering For Kids retains all rights not expressly granted to the franchisee. This includes the right to conduct business activities under any name, in any geographic area (including within the franchisee's territory), and at any location, without granting the franchisee any rights. Engineering For Kids can establish businesses and programs under other systems or marks, offer similar or different services, and operate these businesses inside or outside the franchisee's territory. They can also establish Engineering For Kids businesses at any Large Accounts (locations with multiple affiliated outlets) inside or outside the territory.
The continuation of a franchisee's territorial rights depends on satisfying minimum performance standards and remaining compliant with the Franchise Agreement. Failure to meet these standards may result in Engineering For Kids reducing the territory size, permitting other franchisees or themselves to provide services within the territory, or establishing another Engineering For Kids business in the territory. Franchisees are also subject to territory rules regarding solicitation and program locations, and must refer inquiries from outside their territory to the appropriate franchisee. These rules aim to balance franchisee rights with the franchisor's need for flexibility and growth.